Canada’s Suncor Energy Inc. (SU) has entered into an agreement to sell certain natural gas-heavy assets in west-central Alberta for C$235 million ($230 million) in cash. The name of the buyer was not disclosed.
Located at Rosevear and Pine Creek in the Edson/Whitecourt area, about 200 kilometers west of Edmonton, the properties have a current daily production rate of approximately 20.5 million cubic feet of natural gas and 540 barrels of liquids. The transaction is expected to close by the middle of second quarter 2010.
For Suncor, the deal is part of the company’s strategy to divest an array of non-core assets (some of which it acquired through its acquisition of Petro-Canada last year) to fund its core oil sands development projects in western Canada. In fact, Suncor is targeting asset sale of up to C$4 billion in 2010, as it looks to reduce debt following the Petro-Canada acquisition.
The company has already divested properties in British Columbia, Colorado, Trinidad and Tobago, while there are plans to sell some North Sea assets as well. To date, including the Alberta transaction, Suncor has divested around C$1.54 billion in non-core assets.
Calgary, Alberta-based Suncor Energy is Canada’s premier integrated energy company. Suncor’s operations include oil sands development and upgrading, conventional and offshore crude oil and gas production, petroleum refining, and product marketing under the Petro-Canada brand. Suncor’s business can be divided into five segments: Oil Sands, Natural Gas, East Coast Canada, International, and Refining and Marketing.
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